Sorry, you need to enable JavaScript to visit this website.


Department of Small and Local Business Development

DC Agency Top Menu

-A +A
Bookmark and Share

DSLBD Updates Regulations Governing Local, Small, And Disadvantaged Businesses Enterprises Contracting


The Director of the Department of Small and Local Business Development (“Director”),  pursuant to the authority set forth in the Small and Certified Business Enterprise Development and Assistance Act of 2005, effective October 20, 2005 (D.C. Law 16-33; D.C. Official Code § 2-218.01 et seq. (“Act”), and Mayor’s Order 2009-58, dated April 15, 2009, hereby gives notice of her adoption of the following amendments to Chapter 8 (Local, Small, and Disadvantaged Business Enterprises Contracting) of Title 27 (Contracts and Procurement) of the District of Columbia Municipal Regulations (“DCMR”).


A Notice of Proposed Rulemaking was published in the D.C. Register on July 10, 2020, at 67 DCR 8465. No written comments on the proposed rules were received during the public comment period. Minor changes were made to the rules as proposed that were in keeping with the statute, including grammatical or punctuation changes, and changes that added clarity.


These rules replace the Department’s current regulations (27 DCMR § 800 et seq.), originally issued in 2009, and reflect the significant changes to the certified business enterprise program made by the Small and Certified Business Enterprise Development and Assistance Amendment Act of 2014 (“2014 Act”), effective June 10, 2014 (D.C. Law 20-108; 61 DCR 3892).

The following summarizes some of the major aspects of the rules: Small and Local Business Opportunity Commission

The rules delete all references to the Small and Local Business Opportunity Commission, which no longer exists. A business may now appeal the denial of an application for certification, the revocation or change to a previously issued certification, or an enforcement action taken pursuant to the Act directly to the Office of Administrative Hearings (OAH).


Subcontracting Requirements for Construction & Non-Construction Contracts and Subcontracting Plans

The rules reflect changes in the 2014 Act requiring that all construction and non-construction contracts for government-assisted projects in excess of $250,000 include at least 35% of the dollar volume of the contract be subcontracted to small business enterprises (SBEs). If there are insufficient qualified SBEs to completely fulfill the 35% subcontracting requirement, the subcontracting requirement may be satisfied by subcontracting 35% of the dollar volume to any qualified certified business enterprise (CBE), provided that all reasonable efforts shall be made to ensure that qualified SBEs are significant participants in the overall subcontracting work.


Enforcement and Penalties for Breach of Subcontracting Plan

Under the rules, for any subcontracting plan required by law, the beneficiary shall be deemed to have breached the subcontracting plan for utilization of SBEs or CBEs in the performance of the contract if the beneficiary fails to submit subcontracting plan monitoring or compliance reports  or other required subcontracting information in a reasonably timely manner, submits a monitoring  or  compliance  report  or  other  required  subcontracting  information  containing  a


materially false statement, or fails to meet the subcontracting requirements outlined in section 2346 of the Act (D.C. Official Code § 2-218.46).


A contractor that is found to have breached a subcontracting plan for the utilization of CBEs shall be subject to the imposition of penalties, including monetary fines, pursuant to section 2363 of the Act (D.C. Official Code § 2-218.63).


The Department may conduct periodic spot checks of CBEs, now defined in the Proposed Rules as an unannounced cursory, on-site inspection of a CBE headquarters to ensure continued compliance with eligibility requirements of the Act and these regulations. The Department may revoke CBE certification upon discovery of non-compliance.


The 30-day notice to cure given to non-compliant entities is eliminated and replaced by a notice of corrective action before the Department would implement any sanctions.


The Department may refer a matter to the Attorney General for the District of Columbia for civil action, or the Office of Contracting and Procurement (“OCP”) for investigation and possible debarment if it is found that a CBE, certified joint venture, or beneficiary has engaged in conduct in violation of section 2363(a)(3) of the Act (D.C. Official Code § 2-218.63(a)(3)).


Waiver of Subcontracting Requirements

The rules require that a waiver request must come from an agency, not the beneficiary. For public-private development projects the Department may exclude acquisition costs and related financing fees from the total development budget amount when determining the 35% SBE subcontracting requirement of section 2346 of the Act (D.C. Official Code § 2-218.46).


Enforcement Mechanism Against an Agency

Under the rules, the performance plan for each agency shall include a metric for compliance with the provisions of the Act and the performance evaluation for each agency director shall reflect the agency’s success in meeting those compliance goals.


Certification and Subsequent Certificate of Registration (Recertification) Process

The rules extend the certification period from two (2) years to three (3) years, provide guidance on shared workspaces, define “Principal Office” as the “headquarters for the business”, provide guidance on demonstrating that the chief business officer and highest level managers perform functions in the Principal Office, and provide guidance on how affiliation with another business is reviewed by the Department.


Under the rules, a CBE that has had no material change in its business status can obtain recertification by submitting a sworn affidavit attesting that the CBE has had no material change and still meets the certification requirements; and, has clean hands and is in good standing required by D.C. Official Code §§ 47-2861 and 29-102.08. “Material change” is defined as a change in a business ownership, address, or size (if an SBE). A CBE that meets the requirements above is deemed recertified upon the submission of the written application.


Small Business Capital Access Fund

In keeping with the 2014 Act, the rules convert references to the Microloan Fund into references to the Small Business Capital Access Fund and delete all references to the Collateral Support Loan Guarantee Program, which is a program run by the Department of Insurance, Securities, and Banking (DISB).


Equity and Development Participation

The rules define the requirements for certification as a Small Investor, Disadvantaged Investor, and Certified Equity Participant.


The regulations can be found here: